Roblox shares plummet 18% as child safety measures weigh on bookings

roblox Shares fell 18% on Friday after the company reported first-quarter earnings as new child safety measures put pressure on bookings.

“We believe part of what we’re rolling out with age checking is the real, true long-term way to build this platform,” CEO David Baszucki said Friday on CNBC’s “Squawk Box.”

One letter to shareholdersThe game company wrote that the new age check feature “restricts communication on the platform for users who are not age-checked, dilutes communication for users whose age is checked, and slows down new user acquisition,” which causes greater negativities than expected.

In January, the company limited the chat feature to users who had completed it. age check verification. According to the company, as of Jan. 31, 73% of daily active age-checked users on Roblox were under 18; 35% were under the age of 13.

To account for slowing growth, Roblox lowered its full-year 2026 guidance.

The company updated its bookings for the full year 2026 to fall between $7.33 billion and $7.6 billion. 2026 reservations are almost There was an increase of $1 billion last quarterIt fell between $8.28 billion and $8.55 billion.

“Our aggressive drive to improve security, while lowering our expectations for revenue growth in 2026, makes our platform fundamentally better and strengthens Roblox’s long-term growth potential through more effective content targeting, tailored communications experiences, and enhanced community engagement,” the company said in its letter to shareholders. he wrote.

Roblox’s first-quarter results beat Wall Street’s forecasts; The loss of 35 cents per share beat the forecast loss of 41 cents per share. It reported revenue of $1.73 billion for the quarter, narrowly beating analysts’ estimates of $1.72 billion.

Roblox facing More than 140 cases According to Reuters, the US Federal Court accused the company of failing to protect children from sexual abuse. Last month, the company reached a settlement with Alabama and West Virginia, agreeing to pay a total of $23.2 million.

The company announced new account types Last month expanded parental controls for younger age groups, as well as expanded parental controls.